KANSAI PAINT JAPAN’S EXPORT MARKETING STRATEGY

Presented to Dr. Mubasher Munawwar Khan

DECEMBER 31, 2013 PRESENTED BY

MEHWISHAN JOOHI MBAE2012-027

MUHAMMAD ALI SHAFIQUE MBAE2012-043

HALEEMA TARIQ MBAE2012-048

MUHAMMAD ADEEL MBAE2012-053

SABEEH HABIB CHAUDHRY MBAE2012-055

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1 CONTENTS

2 Executive Summary ............................................................................................................................... 3

3 Deciding Whether to Internationalize .................................................................................................. 4

3.1 Introduction .................................................................................................................................. 4

3.2 Corporate Mission ......................................................................................................................... 5

3.3 Product Portfolio ........................................................................................................................... 5

3.4 Technology Overview .................................................................................................................... 8

3.4.1 Basic Technology ................................................................................................................... 8

3.4.2 Paint Technology ................................................................................................................... 8

3.4.3 Application Technology ......................................................................................................... 9

3.4.4 Color Technology and Color Design .................................................................................... 10

3.5 Motives for Export ...................................................................................................................... 11

4 Viable Markets to Enter ...................................................................................................................... 12

4.1 Markets Covered by Kansai Paints .............................................................................................. 12

4.2 Asia-Pacific Paint and Coating Market Breakdown ..................................................................... 12

4.3 Pakistan ....................................................................................................................................... 13

4.3.1 Background ......................................................................................................................... 13

4.3.2 POLITICAL AND LEGAL ANALYSIS ........................................................................................ 13

4.3.3 ECONOMIC ANALYSIS .......................................................................................................... 13

4.3.4 Raw Material ....................................................................................................................... 13

4.3.5 Foreign Investment ............................................................................................................. 14

4.3.6 Demand ............................................................................................................................... 14

4.3.7 Market Segmentation Based on Paint Usage ..................................................................... 15

4.3.8 Competitor Analysis ............................................................................................................ 15

4.3.9 Market Position of Kansai Paints in Pakistan ...................................................................... 16

4.3.10 Target Segments for Kansai Mosquito Repellant Paint ...................................................... 17

5 Designing and Implementing Marketing Strategy for Mosquito Repellent Paint in Pakistan ............ 18

5.1 Product ........................................................................................................................................ 18

5.2 Pricing .......................................................................................................................................... 20

5.2.1 Formula Cost ....................................................................................................................... 21

5.2.2 Sale Price of Product ........................................................................................................... 22

5.3 Place ............................................................................................................................................ 23

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5.3.1 Kansai’s Distribution Network ............................................................................................ 23

5.4 Promotion ................................................................................................................................... 24

5.4.1 Brochures ............................................................................................................................ 24

5.4.2 Print Media.......................................................................................................................... 24

5.4.3 Social Media ........................................................................................................................ 25

5.4.4 Posters/Fliers ...................................................................................................................... 25

5.4.5 Broadcast Media ................................................................................................................. 25

5.4.6 Advertising Gifts .................................................................................................................. 26

5.4.7 Sampling .............................................................................................................................. 27

5.4.8 Seminars .............................................................................................................................. 28

6 References .......................................................................................................................................... 29

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2 EXECUTIVE SUMMARY

Kansai Paint is Japan’s no. 1 company in paint and coatings industry. The company has strong presence

in more than 17 countries. Kansai paint has been in Pakistani market since 1992 where it enjoys solid

market share in automotive paints. Since 2009 the company has launched its decorative paints division

in Pakistan. The competition in decorative paints is fiercer than what Kansai faced in the automotive

paints. Exploiting the strong technological and research driven business model, Kansai paint is looking to

launch an innovative product that features lead free, water-based, insect repellant formula. The paper

will look into the opportunities for this product and will propose strategies for a successful launch of the

product in Pakistan. The paper is divided into three main parts given below:

Part 1: Decision whether to internationalize

Part 2: Study of the viable markets

Part 3: Designing and implementing the marketing strategy for mosquito repellant paint

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3 DECIDING WHETHER TO INTERNATIONALIZE

3.1 INTRODUCTION Established in 1918, Kansai Paint Co., Ltd. has grown into Japan’s most progressive manufacturer in

various fields related to coatings. Today, the company enjoys a well-established position as one of the

world’s leading paint manufacturers. The various products provided by the Kansai Paint Group are highly

valued and trusted in a broad variety of fields as their products play many important role such as

protection, beautification, special functionality and environmental sensitivity. Moreover, with Kansai

Paint’s proprietary research and development capabilities at its core, the Company is providing its

clients around the world with unparalleled customer service by expanding its manufacturing,

distribution and sales activities worldwide.

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3.2 CORPORATE MISSION

1. To further build company credibility with the public and to contribute to society, by providing

products and services that achieve customer satisfaction.

2. To build on our knowledge and strive for technological innovations, in order to improve the

company’s performance.

3. To harness the collective efforts of all individuals to maximize the company returns

3.3 PRODUCT PORTFOLIO

The various products provided by the Kansai Paint and its Group companies are highly valued by

customers not only in Japan, but in Europe, the

United States, and Asian countries such as China,

and India. Kansai paints are playing important

roles in the protection and beautification of all

types of products and merchandise. Some of our

paints and coatings instill the products with

special functionality. Our products are receiving

high praise and earning a reputation for

exceptional reliability in a wide range of fields.

The fact that we hold a large share of the

automotive coating market and that our

products are used by many automobile

manufacturers contributes to the good

reputation we enjoy. We also continue to put unwavering effort into products for all types of items

requiring painting or coating, including industrial products, residential housing, office buildings, and

steel structures such as ships, bridges and plants.

Kansai Paint is much more than a paint manufacturer that simply sells its products through its joint

ventures and affiliated companies.

Throughout the world, Kansai Paint

utilizes the achievements and

knowledge earned through

research and development efforts,

and transforms these into technical

services that the company is able to

provide its customers together with

the company’s outstanding

products and services.

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3.4 TECHNOLOGY OVERVIEW

3.4.1 Basic Technology

Kansai Paint has its R&D facilities and organizations located collectively in its R&D Center at Hiratsuka,

Japan. Basic technological research is also centralized at the same premises together with both

dedicated technical experts and advanced laboratory equipment.

The key to providing paint with various functions lies in synthetic polymers. Functions of paint such as

low dirt-smearing or water-repellence are obtained by polymer designs and syntheses at molecular

level. These kinds of synthetic polymers are so diverse that technical staff at Kansai Paint research the

best options from among innumerable combinations.

The advances in computer science of recent years have also been applied to this field in order to help

simulate chemical reactions and the molecular structures of paint components. As a result of these

steady efforts, the product research and development time has been vastly reduced.

Kansai Paint also utilizes the latest in analytical and physical measuring equipment in order to identify

the behavior of various paint components and to improve the physical and chemical properties of the

paint film. As an example, the data obtained on the rheology of wet or dry film helps to provide a solid

foundation and back-up to the research and development tasks carried out.

3.4.2 Paint Technology

Kansai Paint is a comprehensive manufacturer of paints and coatings. We develop and supply the most

advanced products to almost all of the industrial sectors. All-round performance is the main

requirement of paint and no matter how revolutionary the material or technology may be; it will never

be commercially produced if there is even a single problem in the paint’s quality or if it is too costly to

produce. Moreover, even

if the paint has an

excellent quality, if it

cannot be practically

applied to build a sound

film it will also be

discarded.

Over the past few years it

has become even more

important to develop

environmentally friendly

and people-friendly

products. Therefore, it is

a prerequisite for the

R&D team to ensure that

hazardous substances are not used and to pay full attention to the reduction of VOC (volatile organic

compounds) during the process of application and curing of the paint.

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The key to solving these problems, meeting each and every requirement, and launching innovative and

attractive products is in scientifically controlling the composition of multiple substances, the individual

behavior of each component and the chemical interactions among them within the paint. One may say

that paint technology is indeed a fine art form of chemistry itself. Currently a large number of these

highly advanced technologies are exported by Kansai Paint on a technical license around the world.

3.4.3 Application Technology

Paint in a can is not an end user product yet. Paint only becomes a valuable material and plays its role

when it is applied to the surface of an object through a specific application process. Application methods

play a big part in determining the final appearance of the dry paint film and the quality that the paint

gives the finished product. On top of this it often affects paint film performance too. Therefore, it is also

of great importance for both the economy and the environment to minimize the overspray of paint

which falls off the

substrate or becomes

airborne without

attaching to the

surface of an object

during application. By

avoiding excessive

overspray through

special application

processes the

amount of resources

used as well as the

overall cost can be

greatly reduced.

As a paint

manufacturer, Kansai

Paint researches

these application

technologies in order to achieve a high level of customer satisfaction by providing services and an

integrated system of paint and application processes. For example, the R&D team of Kansai Paint’s

Automotive OEM Coatings division has introduced a full-size application line in its laboratory at

Hiratsuka which is identical to one used at a car manufacturer’s plant. This allows the R&D teams to

gather the necessary data to pursue, in a practical manner close to the car manufacturer’s line

conditions, further development in both the paint and paint application fields.

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3.4.4 Color Technology and Color Design

Paint has two goals that it needs to fulfill; one is to protect the coated object and the other is to give

added value to the product provided by the paint’s aesthetically pleasing color properties, which can

affect human psychology. This is especially relevant as in the modern world a strong emphasis is placed

upon “sensitivity”, and the consumer expectation for high quality paint is getting stronger and stronger

in many societies across the world.

However, beauty alone does not make the paint. Paint must be beautiful on the one hand and on the

other its desired functions must perform well under harsh conditions for a long period of time. In many

cases, despite the paint’s desirable color, it cannot be produced commercially due to its poor

performance and poor durability in practical usage. In the color research and design laboratories at

Kansai Paint, designers

and chemists work

together in an attempt

to improve both the

functional and aesthetic

aspects of the paint.

Moreover, to create a

pleasant living and

working environment,

Kansai Paint creates

positive color designs

such as “stress-free

office colors”, and

“elderly-friendly

colors”. These efforts

have been recognized

by various

organizations with

reputable awards and

as such we are

confident that our

product can deliver.

The world of “color” tends to be perceived only by sensitivity or sentiment, but in actuality it is backed

by sound logic and reasoning.

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3.5 MOTIVES FOR EXPORT After taking into account all the internal resources of Kansai Paint and the corporate mission of the

company, the following motives of export are obvious:

Proactive Reactive

Technology competence Competitive pressures

Profit and growth goals Domestic market Saturation

Managerial urge Overproduction

Foreign market opportunities

Economies of scale

Tax benefits

With many successful operations overseas, the company has already overcome many difficulties of

internationalization. Equipped with this knowledge, Kansai Paint is in a good position to strengthen and

extend their global presence. In the ‘strategic windows’ model, the company is in a phase of

strengthening its global position be extending its markets to even more countries of the world.

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4 VIABLE MARKETS TO ENTER

4.1 MARKETS COVERED BY KANSAI PAINTS With the high quality of products, Kansai has a strong presence across the globe. The world map shows

the coverage in following areas/regions: U.K. | TURKEY | U.S.A | CANADA | MEXICO | SOUTH

AFRICA | CHINA | THAILAND | SINGAPORE |TAIWAN | VIETNAM | PHILIPPINES | INDONESIA | MALAYSIA | K

OREA | INDIA | UAE

4.2 ASIA-PACIFIC PAINT AND COATING MARKET BREAKDOWN Asia-Pacific Paint and coating Market Overview

Segment Market Size (Tons)

Decorative Paints 7,752,837

Industrial Wood Coatings 1,583,343

Automotive OEM Coatings 1,346,662

Automotive Refinishes 360,694

Powder Coatings 1,362,903

General Industrial Coatings 1,808,766

Protective Coatings 2,485,349

Marine Paints 1,033,871

Coatings for Plastics 320,955

Total 18,055,380

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4.3 PAKISTAN Pakistan is a land of opportunities for multinational companies. Its high population, growing migration of

people to urban centers and subsequent changes in lifestyle, generate a demand for high-quality

products that can be supplied by multinationals.

4.3.1 Background

Local paint industry operates both in organized and unorganized sectors. The data regarding production

and number of units of the unorganized sector is not available, therefore, it is difficult to have complete

data about the production and number of units of the paint industry. According to an estimate, over 350

units of paints and varnishes are operating in the unorganized sector. Their products are substandard

though their cost of production is comparatively low. Many of them also avoid payments of excise duties

and therefore, are in a better position to compete in the local market.

4.3.2 POLITICAL AND LEGAL ANALYSIS

The Political condition and Government rules and regulations of the country can affect any industry

whether that is at introduction, growth, maturity or at decline. The same case is with the paint industry

of Pakistan. Since many years the political condition of the country is not very certain. The suicide

attacks, poor law and order condition in northern areas and unstable new government creates risks for

paint business. The high costs of the petroleum products, energy crisis and lack of infrastructure are the

major hurdles in the growth of this industry.

4.3.3 ECONOMIC ANALYSIS

Economy has a critical role in fostering the success or creating problems for any organization. Similarly in

case of paints industry, this industry is facing instability in the sales and growth from many years.

Government has imposed16% sales tax and heavy duties on imports of raw materials. Paints industry of

Pakistan import 75% of its raw materials so import duties have increased the production cost thus

decreasing the profit margin. Recessionary conditions continued to prevail as the government pressed

on with its efforts to document the economy. The depressed construction industry and the slow trading

industry and the slow trading environment resulted in an overall market shrinkage in the decorative

business by 10%. Against this backdrop the business however has able to increase its market share by

1% through its strong advertising and promotional campaigns and effective after sale service. The

industrial business continued to deliver a robust performance driven by penetration of new market

segments within the general industry sector.

4.3.4 Raw Material

Paint industry uses about 300 different types of raw materials for producing various kinds of paints.

About 15 per cent raw materials of the industry are petroleum based. In 1971 between 80 to 90 per cent

requirements of the materials were met through imports which have been reduced in recent years due

to increased production of indigenous raw materials. The major imported raw materials include

pigments, zinc oxide and titanium oxide. Most of raw materials is available locally. At times raw

materials are imported in large quantities compared with their demand which affects quantity of

imports.

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4.3.5 Foreign Investment

Foreign companies in Pakistan's paint industry have been fairly active. In fact quite a few of the leading

paints manufacturing units were sponsored by foreign manufacturers and are operated in collaboration

with local entrepreneurs. Two of these foreign-sponsored paints manufacturing enterprises are public

limited companies whose shares, after being offered for public subscription, are quoted on the local

stock exchange. The interest of foreign investors in this industry appears to be due to the fact that most

of these companies began their operations in Pakistan as importers and traders of paints which were

manufactured by their principals in the home country. After the imposition of restriction on the import

of paints, through high tariff barrier, these companies have established their own factories and are

manufacturing their well-known brands. Foreign investment in paints industry was estimated to be in

the vicinity of Rs. 10 million.

Some of the local paint manufacturing enterprises have also established paint manufacturing factories in

the Middle East countries in collaboration with the host country's investors. Such joint ventures by

Pakistani sponsors are reported to have been established in Kuwait, Afghanistan and Lebanon while

more such opportunities are being explored in Saudi Arabia, Iran and other countries of the Gulf.

4.3.6 Demand

The main consumers of paints and varnishes are Government and semi-government organizations such

as Defense Service, Shipyard, Railways, WAPDA, Tarbela Dam; Government Road Transport Agencies

etc. The private housing sector is

estimated to account for 20 per cent of

total paint consumption in the country.

The demand for paints and varnished is

derived from expansion in construction,

building, manufacturing, transport and

other sectors. Moreover, a favorable

turn in the investment outlook in the

private sector, brought about by a

desired change in the industrial and

economic policies of the Government, is

expected to contribute to a pick-up in

the private industrial sector. In view of

this, there appears to exist a sizeable

potential for further strides in the country's paints industry.

The demand for paints in conservatively estimated to increase by 20 per cent annually during the next

five years. Moreover, the development of chemical industry is also taking place and in view of this, most

of the raw materials used by the paints industry, are expected to be produced and manufactured locally

during the next five years. The paint industry would thus find a favorable raw material for further

expansion and growth.

57%

10%5%

12%

2% 3%10%

1%

Product Volume

Gloss Enamel

Interior Emulsion

Exterior Emulsion

Distemper

Cement paint

Wood Finish

Putty

Primer, Thinner

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4.3.7 Market Segmentation Based on Paint Usage

Pakistan's Paint market is segmented on the bases of paint types into the following six types:-

Defense Service Paints: These are variously described as vehicle paints, camouflage paints, scenic

paints, heat resisting paints, ammunition general service paints, radar paints, cellulose lacquers and

enamels.

Marine Paints: Antifouling paints, anticorrosive paints, deck non-slip, boat topping paints, hull paints,

rudder paints, cabin paints, weather resistant paints, machinery enamels; under water paint etc.

Decorative Paints: Synthetic Enamels, hard gloss paints, quick drying paints, varnish paints, ready mixed

paints, stiff paints, paste paints, aluminum paints, bituminous paints black Japan swimming pool paints,

coal tars, varnishes and all types of surface coatings.

Building Paints: Plastic Emulsion paints, oil-bound distemper, dry distemper, dry oxide colors, masonry

paints, flat paints, oil paints etc.

Industrial Finishes: Anti-corrosive paints, chemical resistant paints, heat resisting paints, hammer

finishes, boiler paints, chimney paints, water proof paints, bobbin lacquers, automotive paints and

lacquers, locomotive paints and lacquers, pencil lacquers, nitrocellulose lacquers, enamels insulating

varnish, primers, under-coats surfaces, clear lacquers, polyurethane lacquers, Epoxy lacquers, Tin

printer’s lacquers etc.

Special Paints: Cellulose Dopes, heat resisting paints all weather paints, leather finishes and all types of

special paints which are generally used for painting aircraft.

4.3.8 Competitor Analysis

Pakistani paint and coatings market is quite competitive at the moment. The significant names in the

market include ICE, Berger, Nippon, and Jotun. An important insight into the market is the presence of

unrecognized paint manufacturers. These manufacturers usually sell low quality products at

extraordinarily low prices than the branded products. The market share division is shown in the diagram

given below:

20% 20%

12%

18%

30%

ICI Berger Nippon jotun Others

Market Share

Market Share

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4.3.9 Market Position of Kansai Paints in Pakistan

Kansai decorative products were launched in April, 2009. We have around three hundred dealers across eighty-

seven cities of Pakistan. Our deco products include emulsions for interior and exterior, enamels, pre-deco products,

wood finish and texture paints. With the establishment of Kansai Paint (Pvt.) Ltd. in Pakistan, Kansai has introduced a

whole range of products including CED (Cathode Electro Deposition), top coats, automotive, refinish and decorative

products, leveraging its cutting-edge technology. Kansai Paint Pakistan with its modern, world class manufacturing

facilities has a dominant share in Automotive paints business and is enjoying steady growth in decorative, refinish

and industrial coating markets.

In the automobile paint business, Kansai Pakistan is supplying car paints to Toyota, Suzuki, Nissan, Honda, Hino,

Sigma, Hyundai, Yamaha and Baluchistan wheels. The Company has been in the Pakistan automotive market since

1992. Kansai decorative products were launched in April, 2009. We have around three hundred dealers across

eighty-seven cities of Pakistan. Our deco products include emulsions for interior and exterior, enamels, pre-deco

products, wood finish and texture paints.

Our protective coatings have a wide variety of applications across diverse industrial sectors. In the following areas we

offer exceptional levels of technological proficiency, product supremacy and devoted technical field support:

a) Infrastructure projects, b) oil and gas installations, c) water and power d) manufacturing and maintenance facilities.

The local manufacturing of OEM and high performance coatings has saved and shall continue to save the country

more than a 100 million US dollars of foreign exchange over the next few years. Till date these savings have created

direct and indirect employment for over 500 families.

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4.3.10 Target Segments for Kansai Mosquito Repellant Paint

Today everyone wants to save their time, money, and energy. Currently available emulsions are all oil

based which consume more money, time, and, struggle of the consumers. Kansai Gloss Enamel is high

quality solvent based enamel with gloss finish, suitable for all types of interior and exterior wood and

metal surfaces. Kansai Gloss Enamel gives superior coverage and

brilliant gloss along with the benefits of insect repellent and

ecofriendly composition feature.

In the wake of recent dengue outbreak, our position in the market

looks quite good, we should focus on the following segments of the

market.

Hospitals, clinics, and health care institutes

Federal and province governments looking to mitigate dengue and other diseases in public/govt.

institutes

Offices at high risk of chemical or dengue exposure

Restaurants, shops, and indoor play areas

People who are sensitive to chemical exposure

Individuals with higher income range looking for a quality paint product for their homes

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5 DESIGNING AND IMPLEMENTING MARKETING STRATEGY

FOR MOSQUITO REPELLENT PAINT IN PAKISTAN

5.1 PRODUCT As an established brand name having ecofriendly corporate mission, Kansai paint uses technology to

bring comfort and safety with its innovative products. Kansai paint products are enjoying steady growth

as Pakistani market is getting familiar with the company’s high quality products. In order to further the

growth of our market share, we are launching an innovative product in the Pakistani market. This is our

mosquito repellant water based gloss emulsion. Superior to the competitor’s water based emulsion, this

product will be launched to protect households, offices, and other populated areas from mosquitos and

other insects.

This product’s launch is in response to the recent epidemic break out of dengue fever in Pakistan. The

current epidemic has caused to date 16 580 confirmed cases and 257 deaths in Lahore and nearly 5000

cases and 60 deaths reported from the rest of the country according to WHO. The detail of recent years’

dengue cases is given below:

Year Suspected cases Cases laboratory-

confirmed

Deaths

2006 4961 1931 41

2007 2304 1226 18

2008 2792 2469 17

2009 1940 1085 13

2010 15 901 11 024 40

2011 252 935 17 057 219

2013 8,546 33

The unique property of Kansai Mosquito Repellent paint will attack the nervous and muscular system of

insects. When a mosquito lands on the treated surface, the insect will absorb traces of the solution. This

will result in paralysis and death within a few minutes.

The effectiveness of the product is guaranteed for a minimum period of 2 years from the date of

application, making it both economically and functionally efficient. It can dramatically reduce the spread

of infection-carrying insects and so lower the risk of catching diseases such as malaria, dengue fever,

yellow fever, chikungunya and chagas disease.

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Biting insects and other species such as flies and cockroaches also carry numerous diseases.

Mosquitoes alone cause 2-3 million deaths annually. As well as spreading disease, insect bites can also

cause pain, itching and swelling and general discomfort.

Our solution dries to a clear finish over existing hard surfaces and is effective against such insects as:

Mosquitoes

Flies

Ants

Beetles

Cockroaches

Ticks

Termites

Lice

Spiders

Scorpions

Wasps

Silverfish

Weevils

It also contains an antimicrobial biocide, making it antibacterial, antiviral and antifungal. It is 100% safe

to use following manufacturer’s instructions, is easy to apply and is not mixed or diluted with any other

product.

The product contains an active ingredient which combines an advanced generation pyrethroid with a

unique capsule suspension formulation for outstanding protection against numerous insect pests. The

microencapsulated water-based formulation offers superior insect control. Once the formulation has

been applied and dries, the active ingredient is released from the capsules. Control will occur primarily

through direct contact of the insect pest with the capsules, with the pyrethroid transferring directly

from the capsule to the cuticle of the insect. It is also possible for the capsules to be ingested in the case

of insect pests which preen themselves, such as cockroaches

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5.2 PRICING Kansai Mosquito Repellent Water Based Gloss Emulsion is a premium quality Pure Acrylic-based

emulsion with low to zero VOC, specially designed to give a long lasting color retention finish to exterior

masonry surfaces along with mosquito repelling properties. The price distribution of this product across

different processing phases is calculated below:

Mosquito Repellant Water Based Gloss Emulsion Pricing

Base price Discounted price

Base unit cost Rs 1,125.00

Initial markup 60%

Base unit price Rs 1,750.00

Quantity in this order 1 1

Per unit discount 5%

Total savings per base unit Rs 87.50

Total line item price Rs 1,662.50

Lump sum total Rs 1,750.00 Rs 1,662.50

Sales tax 7.50% 7.50%

Shipping and handling Rs 12.31 Rs 12.31

Total Rs 1,893.56 Rs 1,799.50

Total Savings Rs 94.06

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5.2.1 Formula Cost

Water Based Gloss Emulsion

Codes %ages Price/Kg Formulation Cost

SL4136 13.250 0.01 0.13

AB3212 0.200 275.20 55.04

AD3618 0.150 188.00 28.20

AT3113 0.300 289.34 57.87

AS3519 0.200 307.39 61.48

AD3621 0.700 225.00 157.50

AG3822 0.200 298.61 59.72

PW1122 20.000 380.00 7600.00

PE1315 5.000 47.12 235.62

PE1321 10.000 13.40 134.00

SL4136 1.000 0.01 0.02

SL4155 1.500 294.00 441.00

EM2215 45.000 250.00 11250.00

AT3115 0.800 520.00 1040.00

I275-642 0.200 20.53 4.11

SL4136 1.500 0.01 0.02

100.00 21124.69

Wt./L 1.32

Cost/L 281.66

Labor Cost 15

Mark Up 150

Sale Price Of 1 lit 450

Sale Price Of a Gallon 1800

22 | P a g e K a n s a i P a i n t ’ s E x p o r t M a r k e t i n g S t r a t e g y

5.2.2 Sale Price of Product

The competing companies’ gloss enamels are solvent based products and for which customers have to

bear an additional cost of thinner or solvent. On the other hand, Kansai’s groundbreaking product gives

the same gloss level with added health and environment safety benefits and to top it off the customer

will save the thinner cost as well. The following table compares our product’s pricing with major

competitors. We have proposed the pricing on the bases of cost-based pricing strategy. The slightly

higher prices than the competition will also reinforce the added advantages of Kansai products in

customer’s perception.

Product Tier Retail Price Major Competitors Retail Price

Qtr. Gallon Drum Qtr. Gallon Drum

Kansai Premium

Interior Emulsion

Premium 450 1800 7000 Berger Gloss Enamel 435 1710 6700

Jotun Gloss Enamel 430 1700 6800

ICI Gloss Enamel 420 1700 6900

Nippon Gloss Enamel 425 1720 6850

0

1000

2000

3000

4000

5000

6000

7000

Quarter Gallon Drum

Kansai

Jotun

Nippon

ICI

Brger

23 | P a g e K a n s a i P a i n t ’ s E x p o r t M a r k e t i n g S t r a t e g y

5.3 PLACE Two types of channel of distribution methods are available.

1. Indirect distribution

It involves distributing your product by the use of an intermediary for example a manufacturer selling to

a wholesaler and then on to the retailer.

2. Direct distribution

It involves distributing direct

from a manufacturer to the

consumer For example Dell

Computers providing directly

to its target customers. The

advantage of direct

distribution is that it gives a

manufacturer complete

control over their product.

Kansai is using a combination

of both the direct and indirect marketing. For the launch of the new product we’ll engage our dealers’

network and also offer direct sales to customers throughout Pakistan. Our aim is to reach all of our

varied customer base including hospitals, restaurants, factories, and offices.

5.3.1 Kansai’s Distribution Network

Kansai decorative products were launched in April, 2009. We have around three hundred dealers across

eighty-seven cities of Pakistan. Our deco products include emulsions for interior and exterior, enamels,

pre-deco products, wood finish and texture paints. For the mosquito repellent paint we will specially

train our team to make sure that the benefits of our new product are conveyed to the end users and

buyers.

Manufacturer

Distributor

Retailer

Consumer

Manufacturer Consumer

24 | P a g e K a n s a i P a i n t ’ s E x p o r t M a r k e t i n g S t r a t e g y

5.4 PROMOTION Following promotional mix will be used for promotion campaign of the mosquito repellent paint.

5.4.1 Brochures

Leaflets, informational handouts, inserts will be published and

distributed among the target market and community spreading the

awareness about the product. Brochures are an excellent low-cost

promotional vehicle. As the target audience is supposedly educated

sect of the community, they are more likely to respond to these

brochures. Brochures are especially useful for service businesses

because they enable us to describe our valuable product.

5.4.2 Print Media

Another step would include Advertising in newspapers, newsletters, magazines, and trade and specialty

publications. Cost of advertising in print media varies greatly for print ads: from little to nothing for ads

in local newsletters to expensive ads in publications with national

circulation. Before buying ad space in a publication, it will be ensured

that target audience has a high viewership rate of that media.

We Bring

Shine in

Life!

25 | P a g e K a n s a i P a i n t ’ s E x p o r t M a r k e t i n g S t r a t e g y

5.4.3 Social Media

Kansai paint should launch an awareness and promotion campaign on popular social media networks

like Facebook, twitter, and what Sapp. Some of the competing firms like Berger and Nippon are already

using these media successfully. The competitive advantage of our products being free from lead, eco-

friendly, and good for health and safety will give us a strong message to build our campaign.

5.4.4 Posters/Fliers

For more economical campaign, a low-cost option is also plausible. Posters/ fliers can be posted locally

or handed out in communities. Fliers and posters are a good means of advertising events or “act now”

opportunities to try new product. These are definitely poised to create a buzz in the community about

the new product and will instigate curiosity among the community.

5.4.5 Broadcast Media

For more broad coverage, radio and television can also be utilized. Well-

targeted advertising can reap surprising benefits as it will affect a majority of

the target audience and will create a sense of assurance in customer’s mind

about product credibility.

26 | P a g e K a n s a i P a i n t ’ s E x p o r t M a r k e t i n g S t r a t e g y

5.4.6 Advertising Gifts

Giveaway items emblazoned with company's logo, such as stickers, calendars, Hand bags, T-shirts, and

key chains. These items vary in cost but can prove to be an effective means of developing brand

recognition. Stickers are relatively inexpensive and are popular in many sectors of the community. Such

corporate gifts build a healthy image in customers’ mind

27 | P a g e K a n s a i P a i n t ’ s E x p o r t M a r k e t i n g S t r a t e g y

5.4.7 Sampling

Distribution of free product samples is a great confidence building measure for customers. Painting

contests can be held at various localities of major cities to promote the product’s benefits and spread

the word about effectiveness of the product.

28 | P a g e K a n s a i P a i n t ’ s E x p o r t M a r k e t i n g S t r a t e g y

5.4.8 Seminars

Seminars and workshops can be held in various cities to create awareness about the product. This will

be useful for two reasons.

1. Participation in seminars will raise the company profile

2. New business opportunities, such as strategic alliances with commercial partners such as various

housing societies or institutes can be formed

Seminars create awareness and are a good forum for answering customer’s queries. The face to face

nature of seminars give customers an opportunity to share their feedback with the company directly.

The information exchanged during such events provides a golden opportunity to improve a product’s

quality and customer acceptance.

29 | P a g e K a n s a i P a i n t ’ s E x p o r t M a r k e t i n g S t r a t e g y

6 REFERENCES

http://www.thefreelibrary.com/Paint+Industry+in+Pakistan.-a070394839

http://www.coatingsworld.com/contents/view_market-research/2010-07-06/a-profile-of-the-asia-

pacific-paint-industry/

http://staging.informationresearch.co.uk/uploads/CUBE_press_release/2012-10-08/Asia-

Pacific%20Paints%20Press%20Release.pdf

http://www.emro.who.int/pak/pakistan-infocus/world-health-day.html